The additional expenses required in order to avoid keeping currency during periods of inflation are known as shoe leather costs.
The reasons for keeping cash are pretty straightforward. Cash inflows and outflows may balance out, or the flows occasionally exceed the inflows. Hence, to cover up these eventualities, organizations hold cash to meet certain unpredictable situations. The term "transaction motive" refers to a business's need for cash for ongoing operations. In general, the business needs cash to pay employees' salaries, and rent, pay for labor, acquire items, and other expenses. On the receiving side, the business receives money from customers, debtors, and other sources. The inflows and outflows do not always coincide. As a result, the company keeps some cash on hand to fill this shortfall.
To know more about holding cash, visit:
https://brainly.com/question/15522054
#SPJ4
